Electricity markets regulations: The financial impact of the global energy crisis

IF 5.4 2区经济学 Q1 BUSINESS, FINANCE

Journal of International Financial Markets Institutions & Money Pub Date : 2024-05-10 DOI:10.1016/j.intfin.2024.102008

Ignacio Segarra , Christina Atanasova , Isabel Figuerola-Ferretti

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Abstract

Amid the global energy crisis, we examine the impact of electricity market regulations in the European Union (EU). Pursuing an integrated EU electricity market inadvertently heightened the interdependence between gas and electricity prices. The EU energy crisis, triggered by the gas supply shock, amplified power prices and their volatility. These volatility spikes led to substantial margin increases on power futures contracts crucial for mitigating electricity price risks. The increase in margins placed a substantial financial burden on EU power utilities. We document an almost eight-fold surge in required collateral for long positions in front-month EU power futures contracts during the one-year duration of the crisis. Throughout the crisis, EU utilities experienced lower sales and profitability compared to their US counterparts, and a portfolio of EU power utilities significantly underperformed a counterfactual portfolio of US power utilities.

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电力市场法规：全球能源危机的财务影响

在全球能源危机中，我们研究了欧盟电力市场法规的影响。追求一体化的欧盟电力市场无意中加剧了天然气和电力价格之间的相互依存关系。天然气供应冲击引发的欧盟能源危机放大了电力价格及其波动性。这些波动的激增导致对降低电价风险至关重要的电力期货合约保证金大幅增加。保证金的增加给欧盟电力公司带来了巨大的财务负担。根据我们的记录，在危机持续的一年时间里，欧盟电力期货前月合约多头头寸所需的抵押品激增了近八倍。在整个危机期间，欧盟电力公司的销售额和利润率均低于美国同行，欧盟电力公司的投资组合表现明显低于美国电力公司的投资组合。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Journal of International Financial Markets Institutions & Money Multiple-

CiteScore

6.60

自引率

10.00%

发文量

142

期刊介绍： International trade, financing and investments, and the related cash and credit transactions, have grown at an extremely rapid pace in recent years. The international monetary system has continued to evolve to accommodate the need for foreign-currency denominated transactions and in the process has provided opportunities for its ongoing observation and study. The purpose of the Journal of International Financial Markets, Institutions & Money is to publish rigorous, original articles dealing with the international aspects of financial markets, institutions and money. Theoretical/conceptual and empirical papers providing meaningful insights into the subject areas will be considered. The following topic areas, although not exhaustive, are representative of the coverage in this Journal. • International financial markets • International securities markets • Foreign exchange markets • Eurocurrency markets • International syndications • Term structures of Eurocurrency rates • Determination of exchange rates • Information, speculation and parity • Forward rates and swaps • International payment mechanisms • International commercial banking; • International investment banking • Central bank intervention • International monetary systems • Balance of payments.